Private sector employers added 749,000 jobs in September according to payroll giant ADP, but there were signs of a slowdown in the economic recovery as the COVID-19 pandemic continued to spread.
Small businesses added 192,000 jobs in September, including 121,000 in businesses with between one and 19 employees, and 71,000 jobs in businesses with between 20 and 49 employees. Medium-size businesses with between 50 and 499 employees added 259,000 jobs. Large businesses with 1,000 employees or more gained 297,000 jobs, including 75,000 in companies with between 500 and 999 employees, and 222,000 in corporations with 1,000 employees or more.
The service-providing sector accounted for the bulk of the job gains, with 552,000 jobs added, including 78,000 in professional and business services such as tax preparation and accounting, and 29,000 in financial activities, such as banking. The goods-producing sector added 196,000 jobs, including 130,000 in manufacturing and 60,000 in construction. Franchise employment increased by 20,700 jobs.
Mark Zandi, chief economist at Moody’s Analytics, which compiles the monthly national employment report with ADP, said the job gains were most evident in the industries that were significantly disrupted by COVID-19. “That would include the retail, leisure and hospitality, and health care sectors,” he said during a conference call with reporters Wednesday. “We did also see a big increase in construction employment, which goes to the strength of the housing market.”
“The labor market continues to recover gradually,” said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute, in a statement Wednesday. “In September, the majority of sectors and company sizes experienced gains with trade, transportation and utilities; and manufacturing leading the way. However, small businesses continued to demonstrate slower growth.”
Zandi pointed to a few cautionary notes in the data. “We are seeing a definitive slowing in job creation,” he said. “If we go back in the spring when businesses were reopening, the job gains were substantially larger, so we are throttling back. The easy job gains are increasingly behind us. Those businesses that have been disrupted by the virus have added back probably close to the extent that they’ll be able to until the pandemic winds down in a more meaningful way and allows these businesses to get back into full swing.”
Kevin Busque is head of Gusto Retirement, where he leads the company's efforts to expand access to retirement plans for small businesses and their employees. He founded Guideline, a fee-free 401(k) platform acquired by Gusto in 2025. Before Guideline, he co-founded TaskRabbit, the online marketplace that connects people with local service providers and helped scale it through its acquisition by Ikea in 2017.
Bill Pappas is MetLife's Head of Global Technology and Operations, and is a Corporate Officer and a member of the company's Executive Leadership Team. In this role, he directs a team of more than 38,000 people responsible for technology development, infrastructure, information and cyber security, data strategy and analytics, customer service, operations, crisis management, business continuity and procurement for all lines of business, serving more than 90-million customers across 40+ countries around the world.
Pappas joined MetLife in 2019 from Bank of America, where he was the head of operations for the consumer, small business, wealth management and private banking businesses. In this role, he directed a team comprised of more than 50,000 people delivering integrated service and operations solutions to approximately 63-million consumers and clients. In addition, Pappas led the global business services team that provided integrated technology solutions across Bank of America.
Previously, Pappas was chief information officer for Bank of America's global wholesale banking business, head of global capital markets operations, and head of technology and operations for the Europe, Middle East & Africa, Latin America and Asia Pacific regions. He also served as the global treasury payment operations executive based out of London.
Even with September’s job gains, he noted that the level of employment is only about half of what it was before the pandemic, and the U.S. economy has recovered just about half of the 22 million jobs lost in March and April. For Friday’s official jobs report from the U.S. Bureau of Labor Statistics, he predicted that it will show a gain of 550,000 jobs. Unlike the ADP report, where the private sector job gains were close to 750,000, the BLS report includes government jobs in the public sector. Zandi anticipates the job gains in the private sector will be offset by losses in temporary federal census worker jobs and in cutbacks by state and local governments.
He believes there may be job losses coming later in the year and next year. “The fact that job growth is slowing is an issue, and prospects are that it will slow even more substantively as we make our way toward the end of the year and into the next,” said Zandi. “I’d even go so far as to say that there is a growing risk that we might even see some job losses as we come to the end of the year and early 2021.”
He pointed to the halting pace of businesses reopening during the pandemic, the inability of Congress to pass further stimulus legislation, the discontinuation of the Paycheck Protection Program, and the uncertainty surrounding the election. President Trump’s executive actions to stimulate the economy, such as the payroll tax deferral he ordered through the end of the year, do not seem to be convincing many businesses and employees to spend more money.
“Buckle in,” said Zandi. “Today’s numbers were OK. It’s real progress, but there are some real risks dead ahead of us. It’s going to be hard work getting back to full employment.”
